The Covid-19 has caused significant health, social and economic damage.
For French professionals, the confinement caused severe operating losses. Policyholders hope to be covered for all risks caused by the pandemic, including these losses. However, today, insurers cover part of these risks and not all of them, because of their systemic and already realized nature which excludes them from the definition of an insurable risk. Faced with pressure from professionals, insurance players are considering alternative solutions. So what forms can these solutions take?
Support weakened sectors: solidarity funds and State mechanisms
Solidarity funds for businesses and individuals
First of all, in the absence of complete cover for operating losses, insurers have created solidarity funds to compensate members of seriously affected sectors (culture, hotels, restaurants, etc.). For example, Malakoff Humanis announced on April 2, 2020, the “Solidarity companies Covid-19” scheme worth 200 million euros. The “bancassurers” do the same: thus, Crédit Agricole and Crédit Mutuel - CIC each mobilized 200 million euros to compensate their professional clients in April 2020.
State mechanisms to support hard-hit companies
Insurers also participate in measures designed by the State. The French Insurance Federation has undertaken to finance the national solidarity fund intended for small entrepreneurs, to the tune of 400 million euros as of April 16, 2020. The Ministry of the Economy has also set up 4 additional schemes. credit insurance, with the agreement of 5 industry leaders. CAP and CAP + (acronym for "Complément d'Assurance-Crédit Public") are reinsured by the Caisse Centrale de Réassurance, with an outstanding amount of 5 billion euros each. As for CAP France Export and its Plus version, they allow BPIFrance to reinsure export-related risks, for an amount outstanding of 2 billion euros.
Professionals and individuals: deferred deadlines, extended guarantees
Postponement of disputes, formal notices, and payment for all customers
These actions aim to limit the indebtedness of companies and their employees. However, in times of crisis, payment deadlines become more difficult to meet. Thus, several groups, including MMA and Thélem, have announced the postponement of all litigation, formal notices, and payments of premiums or contributions, for all their clients (individuals, professionals, and companies).
Entrepreneurs and freelancers: guarantees retained in the event of late payment
Also, the member companies of the French Insurance Federation decided on March 17, 2020, to maintain the guarantees in the event of late payment for the policyholders of very small and medium-sized enterprises or the “craftsmen, traders, business leaders” categories. and “liberal professions”. On March 23, the Technical Center of Provident Institutions authorized the retention of guarantees in the event of late payment for the client companies of these institutions.
Extended guarantees and waived deductibles for insured members of the medical profession
Sometimes, the guarantees are even extended to include new cases raised by the Covid-19, like Allianz France which has extended the guarantees of professional equipment to teleworking. Likewise, the MACSF (French health insurance mutual) has extended its professional liability guarantees (RCP) free of charge to cover all its members (health professionals).
Other insurers have eliminated the deductible periods in certain cases, such as Ampli Mutuelle and Generali for liberal health professionals on sick leave.
Social and medical support from insurers in the face of the coronavirus
Material and financial donations for hospitals
These responses are exceptional, in reaction to a crisis of unprecedented magnitude. Faced with this crisis, some insurers are going beyond their traditional role by supporting the medical community. Several donated their stocks of equipment, including masks. Generali and Macif have also made financial donations to the Fédération Hospitalière de France and to the APHP.
Financial donations to support the associative sector
Also, insurers have made financial donations to non-profit organizations. Thus, Macif has paid 2.5 million euros to Restaurants du Cœur, Samu Social, and Secours Populaire. In addition, the Covéa group has provided 500,000 euros to the Fondation des Femmes. Some companies have supplemented these actions by creating Internet platforms to support their policyholders through psychological support, daily advice, or health information.
The coronavirus crisis: a revealer? Towards the insurance of tomorrow
Insurers, therefore, go beyond their role of compensation to provide support and assistance that go hand in hand with the expectations of the general public and with their financial strength.
Indeed, 20% of those questioned in a Kantar poll for Wavestone in February 2020 expected the assurance that it accompanies them daily. And such services are becoming possible, among other things thanks to big data which allows a better knowledge of policyholders and the associated risks. We are therefore seeing a first expansion of the role of the insurer, to respond to the challenges raised by the pandemic.
Covering systemic risks is one of these challenges, and requires innovative solutions. Consequently, insurers and public authorities have already started to reflect on this subject.
The regulatory authority ACPR announced in early May the launch of an investigation into the contracts offered today in France. This investigation aims to draw up an inventory of the measures taken and to determine whether operating losses without damage can be compensated.
Universal pandemic coverage has even already been considered by a working group, led by the Ministry of the Economy and the FFA. This new “CATEX” regime would make it possible to compensate for such “exceptional catastrophes”, in particular by ensuring operating losses without damage.
In the amount of 2 billion euros, it would be reserved for VSE-SMEs (less than 250 employees). It would be financed not only by the premiums paid by each member company, but also by a public-private partnership where insurers contribute up to 2 billion euros per year, and the State takes care of the rest.
The Covid-19 crisis has served as a revealer, thus showing the capacity of insurers to act as well as their limits, but also inciting them to broaden their field of action and to take measures that perhaps announce “insurance”. of tomorrow ".
- Lets face it, the economy is still in pretty bad shape and a lot of people are still interested in saving money